publication . Article . Report . Other literature type . Preprint . 1974

Theories of Economic Regulation

Richard A. Posner;
Open Access
  • Published: 01 May 1974 Journal: Bell Journal of Economics, volume 5, issue 2 Autumn, pages 335-358
Abstract
A major challenge to social theory is to explain the pattern of government intervention in the market - what we may call "economic regulation." Properly defined, the term refers to taxes and subsidies of all sorts as well as to explicit legislative and administrative controls over rates, entry, and other facets of economic activity. Two main theories of economic regulation have been proposed. One is the "public interest" theory, bequeathed by a previous generation of economists to the present generation of lawyers. This theory holds that regulation is supplied in response to the demand of the public for the correction of inefficient or inequitable market practic...
Subjects
free text keywords: Legislature, Public interest, Empirical research, Economics, Finance, business.industry, business, Subsidy, Welfare state, Public interest theory, Economic interventionism, Microeconomics, Social theory
Related Organizations

3. See, e.g., William F. Baxter, NYSE Fixed Commission Rates: A Private Cartel Goes Public, 22 Stan. L. Rev. 675 (1970); Cabinet Task Force on Oil Import Control, The Oil Import Question (1970); Ronald H. Coase, The Federal Communications Commission, 2 J. Law & Econ. 1 (1959); George W. Hilton, The Consistency of the Interstate Commerce Act, 9 J. Law & Econ. 87 (1966); William A. Jordan, Airline Regulation in America: Effects and Imperfections (1970); Edmund W. Kitch, Marc Isaacson & Daniel Kasper, The Regulation of Taxicabs in Chicago, 14 J. Law & Econ. 285 (1971) Paul W. MacAvoy, The Regulation-Induced Shortage of Natural Gas, 14 J. Law & Econ. 167 (1971): Sam Peltzman, Entry in Commercial Banking, 8 J. Law & Econ. 11 (1965) , and An Evaluation of Consumer Protection Legislation: The 1962 Drug Amend52. George J. Stigler, supra note 16, at 4-5.

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